THE TAKEAWAY: Technical positioning hints the S&P 500 may be on the cusp of a reversal lower, hinting a pick-up in haven demand may cut short recent US Dollar weakness.
US DOLLAR TECHNICAL ANALYSIS – Prices broke through support at the bottom of a rising channel set from mid-September, exposing the 23.6% Fibonacci expansion at 9933. A sustained push below that targets the 38.2% level at 9849. Channel bottom support-turned-resistance is now at 9978.
Daily Chart - Created Using FXCM Marketscope 2.0
S&P 500 TECHNICAL ANALYSIS – Prices put in a bearish Evening Star candlestick pattern below resistance in the 1424.90-1430.90 area, hinting the upward correction witnessed since mid-September may be over and the dominant down trend ready to resume. Initial support lines up at 1394.30, the 23.6% Fibonacci expansion. A break below that targets the 38.2% level at 1374.90. Alternatively, a push above 1430.90 exposes the familiar triple top at 1466.10.
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GOLD TECHNICAL ANALYSIS – Prices broke lower as expected after putting in a Bearish Engulfing candlestick pattern, taking out support at a rising trend line set from late June. Sellers now aim to challenge the November 5 low at 1672.50. The trend line (now at 1708.59) has been recast as resistance, with a push back above that aiming to challenge 1752.55.
Daily Chart - Created Using FXCM Marketscope 2.0
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CRUDE OIL TECHNICAL ANALYSIS – Prices put in a Shooting Star candlestick below resistance at the 23.6% Fibonacci expansion (89.48), a barrier reinforced by a minor rising channel top at 90.60, hinting a move lower is ahead. Near-term support is at 87.42, the 14.6% Fib, with a break below that exposing the channel bottom at 85.61 as well as the November 7 low at 84.04. Alternatively a break above 90.60 exposes the 38.2% expansion at 92.87.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com
To contact Ilya, e-mail ispivak@dailyfx.com. Follow Ilya on Twitter at @IlyaSpivak
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